Park Group Share Discussion Threads

[battlebus2] 12/6/2012 07:26

Great results this morning.

[cockneyrebel] 30/5/2012 10:42

These don't hang about when they get going do they :-)

Broken out on a day like today.

CR

[battlebus2] 30/5/2012 09:21

Yep looking forward to those results.

[cockneyrebel] 29/5/2012 16:25

Breaking out of the downtrend resistance here.

Results in a fortnight.

CR

[battlebus2] 11/4/2012 08:22

Yes that's my kind of update!

[m.t.glass] 11/4/2012 07:58

From today's update:

"...The board expects to report a strong financial performance for the year ended 31 March 2012..."

[battlebus2] 28/2/2012 07:21

Marks and Spencers now that is a major deal!

[yandc1] 02/2/2012 19:00

and the prize looks good too although i think it will go down a bit so it may be good to add more...

[battlebus2] 30/1/2012 18:29

Lovely volume today :-))

[battlebus2] 16/1/2012 17:12

Back to 50p mid price and looking great for further rises this year.

[johnthespacer] 11/1/2012 15:05

Anyone know when the next update is due?
Is there anything before June?

Thanks

[a1samu] 21/12/2011 10:06

Research note from Hardman on the 20th December 2011
Hardman & Co. Leaders in Corporate Research 1
Tel: [phone] www.hardmanandco.com
Leaders in Corporate Research
Park Group 48.125p
Ceasing Coverage

20 December 2011
The interim results earlier would put off all but the most dedicated follower. Sales revenues down 10% and a turn round from a profit to a loss were superficially discouraging.

However, strip out the one-off £4.4m gain from the favourable VAT case settlement received last year, and investors are left with little more than the usual seasonal H1 loss. The outlook for both the full year and for the following financial year continue to be good, in our view.

We cease coverage with this research note. In the 10 years we have been researching Park Group, its shares have risen 153% while the FTSE 100 Index has gained 4% - an outperformance of 149%. In all but one of those years it
has paid a dividend; the current yield on our "Initiation of Coverage" price is 9.5%. And at no time in this period has directors called on shareholders to put up extra money. Job done. Shareholders should be content.

We comment briefly on the Interim Results below, but have withdrawn our estimates.
Sector: Consumer Finance
Market: London AIM
Broker: Arden Partners
PR: Tavistock Communications
[phone]
Website: www.parkgroup.co.uk
Description: Park Group is the UK's
leading multi-redemption voucher business.

It is also the biggest provider of Christmas savings schemes in the UK, which it provides through the internet and a network of sales agents. It operates in the e-card and Corporate Voucher marketplace, this business has been growing rapidly.

Park Group 20 December 2011

The following points from the Interim Results announcement are worthy of note:

Interest Income

H1 2011/12 interest income was 28% higher than in the previous H1. This is because the group was able to earn a slightly higher rate of interest on its cash deposits. Interest rates have stayed relatively stable throughout this reporting period, which suggests interest income of c. £1.7m. for the full twelve months, vs. £1.38m in H1 of the previous year.

The Cash Position

Cash balances peaked at a record £152m, up 8.5%.

Consumer Business

The average customer order value for this Christmas was 4% higher, and the number of orders was higher by 5%. Adding these two together accords with the increase in cash balances, which indeed it should. The rise in the size of the average order is roughly in line with the inflation rate. The combined increase is some way in excess of retail spending, so Park Group's business proposition to the store groups is gaining in importance.

Corporate Business

An 8% rise in customer numbers is probably more important than the decision by a major customer to place fewer orders in H1, more than expected in H2.

Flexecash®

The cost of developing and operating this card business is just over £1m a year, and it is clearly rising because this is a complex business. Park Group is having to engineer a different interface for almost every customer, because of the different software systems in use by the various high street chains. Park Group is playing in a major new game here, for potentially high rewards, but there is a cost.
A further issue is a delay in revenue recognition. Sales are recognised when money is drawn off the card, with the traditional vouchers revenue is recognised when the voucher is paid for and posted. A further accounting point is that Park Group only recognises its gross margin on the card, while with vouchers it recognises the total amount. The £60m that has been loaded on the cards in the 18 months since launch is therefore a more significant figure than the declared £3.7m of sales during this half. As flexecash® grows, it will tend to inflate margins, and deflate sales revenue.

Administrative Costs

After two consecutive years of falling administrative costs as a percentage of sales revenue, the financial year to March 2011 saw a rise. This was partly due to the company starting to amortise the previously capitalised costs of developing the flexecash® card. H1 current year administrative costs were again higher than those in H1 of the previous year, by 8%.
We expect full year depreciation and amortisation to be up from £0.9m to £1.5m. In addition to this, Park Group has been hiring more staff to work on the further development of flexecash®. We expect full year administrative expenses to be up from £12m to £13.3m, with higher depreciation/amortisation accounting for approximately half the rise, and additional staff costs most of the rest.

Management Major Shareholders

Chairman: Peter Johnson
Managing Director: Chris Houghton
Finance Director: Martin Stewart
Peter Johnson 57.4%
BSW/IPP Trustees Ltd 9.8%
Schroders plc 9.7%
The Johnson Foundation 3.4%
Key Dates Key Milestones
Full Year Results: June 2012
July 2006: Disposal of loan business
August 2007: Establishment of The Park Prepayments Protection Trust, an independent trust to improve the security of savers' money.
October 2007: Transfer from London Stock Exchange to AIM
May 2010: Launch of card-based flexecash®.
February 2011: Earnings enhancing purchase of property occupied by the group in Birkenhead.

[battlebus2] 08/12/2011 18:33

Back up today with some decent trades.

[a1samu] 07/12/2011 00:53

I see edison, in the link quoted in message 75 are quoting Park at a worst price of 46p, not far off the price that I am calling this share for the immediate future. The market makers will ensure that the price will girate down considerably, especially since there is little turnover in the shares in any event and it is only moved by news. The news yesterday was not very helpful, otherwise the share price would have gone up instead of down.

Neither do I see much growth, except a lot of promises for the future, just like a religion, whose promises of heaven is never realised because you are long before dead, and promises are cheap.

But is the business delivering shareprice outperformance, substantially increased dividends? No, I do not see such sofar, especially when it is considered that not so long ago, this business was delivering massive dividends and a much higher share price than it has been for the last few years.

By increasing dividends by just 5%, the Directors made sure of a reaction of exactly what has taken place, especially when it was combined with a susbstantial reduction in turnover, and massive unadjusted losses at the half year stage, despite of all the soundbites of increases all over the place, which has been repeated in any event for years now.

The Directors boast with their prepaid credit cards achieving a total of £60M being uploaded, yet their turnover and profits do not seem to reflect this. They bought the freehold interest, saving rent, yet their costs increased.

Quite simply, this business lacks transparency and it is not surprising that the market is getting fed up with all the hype, not being followed up by numbers.

[johnthespacer] 06/12/2011 21:19

Interesting reading! Park is a tricky business to value and even more so now that it is in the middle of new things.

Anyway I remain a holder for now!

[battlebus2] 06/12/2011 18:51

a1samu have you no sense that this is a growth company and that the future prospects are looking ever brighter.Not sure you understand the business model fully. It will never hit the low of 40p that you speak of with those results, just wait till the next results when we will see the profits. Any way here's a link to edison read it to get the true picture and the answers to most of your negatives

[a1samu] 06/12/2011 17:36

The only possitive in the iterims is the paultry increase of the dividend by 5%, not the actions of a true growth business.

These directors even managed to report a reduction in sales over the last six months period and yet they are writing ad nauseum about increases in all sorts of stuff, and how wonderful it is likely to be in the future, but the significant ones which are the turnover, profits and cash, all are down whatever the reasons.

It is very hard going for this company to achieve a significant breakthrough from established patterns and the benefits of the flexecash card, are escaping the shareholders for now. One ray of hope is that the company has not embarked on any ill thought out acquisition and that it is sticking to it knitting.

The xd dividend day is a long way off and there is at the moment nothing to keep this share price up and it is likely that the price will slump to below 40p in the meantime.

A true growth business would have reported turnover multiplied many fold, profits of a significant amount, a massive increase in the dividend, like doubling it or something even more, and shareprice increasing accordingly, but none of this has happened sofar and therefore this company will continue to be rated as a mediocre to middling, boring stock.

Shame, the time obviously has not yet come for the directors to wake up to the realisation that they should be trying much harder adding value to their sharholders. But perhaps they have forgotten the needs of the shareholders, when according to the last accounts, when dividends were increased by 39% the directors remmuneration went up by over 60%. The only reason of exceptional high profits, on which the directors remuneration was based, was the 'fleming' refund, which was caused by the negligence of the directors in any event in previous years, and now they have rewarded themselves on retrieving these monies, which should never have been paid out in the first place.

[battlebus2] 06/12/2011 07:44

As expected all to come for the years 2012/2013 with an increased dividend to show their optimistic about the future prospects. Holding long term.

[cockneyrebel] 05/12/2011 16:25

100k trade at a premium

CR

[johnthespacer] 05/12/2011 12:40

Results out Tomorrow Tue 6th Dec - what are we expecting?

[a1samu] 03/12/2011 10:51

On page 5 of the Annual report & accounts 2011, Family Trust is highlighted, a charity giving grants to families of disabled children, who switched to the flexcash card in September 2010 and are very happy with the savings made as a result. The charity gave grants of £33M to over 25000 applicants in 2010. On their website, the cahrity states that they helped 56700 families in the year.

Perhaps Park will be uploading all of the total of the grants issued of £33m/year onto individial flexcash cards in the current financial year? So what margin may Park produce from this turnover, I wonder?

The subject of corporate action comes into focus and whether any developments will be released with the interims, next Tuesday?

I was not at the AGM on the 20 September, and Park did not release the customary result of the event, but I must assume that the resolutions were carried, to issue shares for cash of £1120206.60 or 33.3% and further issue of £168030.98 or 10% of the existing equity. I am quietly excited that may be, may be Park will dare to bid for some other business in the £4Billion market place that it is part of.

I am hoping that they have now passed the times when harebrained ideas like potato chips, or subprime loans were attempted as a diversification, thereby losing over £30M in total.

Under major sharholders on page 14, Mr P R Johnson is listed as having an interest in 94,46489,325 shares or 56.33% of the issued capital, which gives an income of £1,703,687.85 at the current rate of the dividend of 1.8p.

An interesting note is made to say that Allied Irish Banks plc, AIB Jerseytrust Limited and AIB Bank (CI) Limited have notified their interest. Perhaps Mr Johnson had to hock his shares to the bank to fund Tranmere Rovers?

Mr Johnson is also shown as receiving in total directors remmuneration of £512,000 for the year ended 31 March 2011.

Of course to keep a hobby going like being the Chairman of a football club is frightfully expensive and though Mr Johnson has been involved with Tranmere Rovers for many years, there is just a hint of suggestion that what may happen, if the banks wanted their money back? With Mr Johnson losing his controlling stake, there may well be prospects of major corporate action in time to come?

[sivadnoj] 02/12/2011 18:55

770k!! This seems to average around 20k a day.

[battlebus2] 02/12/2011 18:49

Lots of action to come imv with that 770k trade after hours at 56.5p

[battlebus2] 30/11/2011 22:19

Very good jaz.